Knowledge Centre:
News Digests

Stay abreast of what’s happening internationally with developments in corporate public affairs. Here is news that you may find useful and interesting:

Lessons from the Big SpillND

Harold Sirkin, Bloomberg Businessweek, 13 August 2010

There are several lessons that we can learn from the BP oil spill. Firstly, the disaster has demonstrated the need for smarter regulation, and more vigourous enforcement of regulations. In light of America’s dependency on fossil-fuels, the spill has also demonstrated that America needs to begin weaning themselves off oil, and that the government needs to invest in and subsidise other energy sources such as nuclear, wind, solar, biomass and hydroelectric power. The spill has also reflected the factƒ that there are consequences for companies that cut corners, both in monetary terms and in terms of reputation, and hence should act as a deterrent against reckless corporate behaviour as well as promoting accountability. For more information see

Migrant workers and human traffickingND

Richard Welford, CSR Asia, 11 August 2010

Throughout Asia the illegal movement of workers is widespread. Many workers tend to find they are working in factories and forced to endure low wages. Businesses can help eliminate this issue by reducing the demand side of migrant workers and human trafficking. Multinational firms can have a major impact by forcing its subcontractors to follow suit, to make sure that trafficked and forced labour is not being used anywhere in the supply chain. But there is also a moral obligation on business to make sure that workers are not exploited and are not victims of such crimes against humanity. For more information see

Creative partnerships: The future for CSR?ND

Knowledge@ASB, 10 August 2010

Collaborative organisations are arising between big multinationals and poverty alleviation agencies. The partnerships seek to develop products that are a benefit to poorer populations. Some stakeholders might consider these partnerships as a ‘greenwashing’ exercise, but it is up to the multinational companies to communicate the good intentions. The most important consideration for these partnerships is to convince CEOs that they are self sustaining. This will allow them to make a profit that can be reinvested back to expand the partnership in the future. For more information see

Beyond petroleum: Why the CSR community collaborated in creating the BP oil disasterND

Natalya Sverjensky, Ethical Corporation, 2 August 2010

The BP oil spill has revealed an inconsistency between companies’ reputations and their actual practice. Despite having shifted away from renewable energy in recent times, before the spill BP had established itself as an environmentally-aware company and had won various CSR awards. This inconsistency between CSR benchmarks and actual corporate practice calls for important changes in evaluating corporate reputation; including the need to rethink the meaning of ‘CSR’, to develop more transparent and comprehensive awards criteria and to subject energy companies’ communications campaigns to greater scrutiny and regulation. For more information see

The rising power of the Chinese workerND

The Economist, 31 July 2010

Cheap labour in China has characterised economic growth in the past, however recent labour protests and reforms in labour laws demonstrate a change in the domestic situation and have resulted in increased wages for Chinese workers. Higher wages in China will not only benefit workers, but may potentially benefit the international labour market through boosting America’s exports and hence creating more jobs. China does however need to increase its supply of skilled workers, which will require the government to undertake a relaxation of regulations. For more information see

Making fun of businessND

Lia Timson, Sydney Morning Herald, 29 June 2010

Companies and government agencies are discovering a new way of attracting customers as well as employees; developing engaging and fun game programs for recruitment, marketing and training purposes. These games provide a good way for companies to differentiate themselves, as well as to engage and attract Generation Y. While these programs may be fun, it is important to ensure that the games are relevant to the brand and that they achieve their ultimate purpose. For more information see

How not to engageND

Gabriel Chong,CSR Asia, 28 July 2010

NGO organisations are a necessary partner of businesses and understanding their position is important for fruitful relationships. Understanding that NGOs are not only used for organising events and that partnerships are more valued than donations given at arms length is important. NGOs have their own objectives and they need to be paid fairly in order to conduct their activities, these activities are not always identical to what businesses want. It is important to not impose ideas on NGOs and understand that not all opportunities can involve media coverage. For more information see

Why your customers don’t want to talk to youND

Matt Dixon and Lara Ponomareff, Harvard Business Review, 28 July 2010

Research has demonstrated a changing trend in customer preferences towards self-service as opposed to dealing with employees. Companies tend to greatly overestimate the extent to which customers actually want to talk to them, with research demonstrating that the preference of self-service holds regardless of age, demographic, issue or urgency. Subsequently, companies might potentially be over-investing in practices that actually dissuade customer loyalty. For more information see

BP: A failure of focus and metricsND

Lisa Hershman, Bloomberg Businessweek, 27 July 2010

The wake of the BP oil spill has left people wondering what caused the disaster, as well as pointing out the need to prevent such a disaster from reoccurring. Although BP may have recognised the importance of investing in safety, they didn’t implement measures to assess the efficiency and effectiveness of their safety measures. While BP executives may have believed that they were meeting safety requirements, their knowledge of and focus on these requirements was shallow. As such it is important that companies recognise that merely investing in safety is not necessarily adequate, and that they take steps to engage completely with these issues. For more information see

Brand building, beyond marketingND

Nicholas Ind and Majken Schultz, Strategy + Business, 26 July 2010

People are increasingly losing trust in brands and viewing brands more cynically. This has created a challenge for many companies, with the more innovative recognising this trend and adapting their branding strategies accordingly. Successful companies are shifting away from leaving branding to their marketing department, and are increasingly focusing on direct communication with customers to build trust in brands. This new approach to branding requires companies to focus on content not communication, to be aware of the way they use language, to lessen their control over the brand, to increase their openness and to experiment and learn from their mistakes. For more information see

Winds of change head for the workplaceND

Lynda Gratton, Financial Times, 25 July 2010

The workplace is undergoing a period of change, now experiencing a ‘state of in-between’ following the economic crisis. The article provides the highlights from a four-year project conducted by the London School of Business, examining the direction that we’re heading in and how this will affect the nature of work. Amongst various changes will be the shifting balance of power within companies, the prevalence of generation-Y in the workforce, and the impacts of developing countries on the market and the environment. For more information see

Inside BP: a giant woundedND

James Boxwell and Ed Crooks, Financial Times, 21 July 2010

The BP oil spill has not only affected BP’s external image, but is also having a significant effect on its employees. Conversations with staff reveal that employees are worried about their jobs and savings, and are dismayed at their company’s role in the disaster and their management of it. Employees have also expressed anger at the media and US politicians for demonising their company. BP faces massive challenges in the wake of this oil spill, including rebuilding their corporate reputation, rebuilding its inner morale and recruiting new staff. For more information see

BP and Gulf of Mexico — A way forward to restore modern capitalism?ND

CSR wire, 15 July 2010

The recent problems facing BP in the Gulf of Mexico can be interpreted by one thing, Risk. The lack of understanding regarding risk management can lead to serious issues for businesses. Specifically for businesses, poorly handled risk management can result in material social harm, damaging a business’s reputation in the process. Management of risk is too important a task to be left to staff professionals. Poorly managed risk threatens the fundamental financial value of the enterprise and so preserving enterprise value through proper stewardship of risk is a fundamental Board of Directors responsibility. For more information see

Twitter, twitter, little starND

Felix Gilette, Bloomberg Businessweek, 15 July 2010

Companies are recognising the potentials of social media and are rushing to hire social media directors. Hiring social media employees has become a booming industry, with companies such as Sears Holdings, Panasonic and Citigroup all hiring in this department. Social media departments are blending the categories of marketing and customer service, promoting their company online while also diffusing online criticism. Companies however need to recognise that not all self-professed Facebook and Twitter experts can translate their skills into a business context. For more information see

Chinese factories now compete to woo laborersND

Andrew Jacobs, The New York Times, 12 July 2010

Tides have turned in China to favour workers in employment relations. Employers in many parts of China now compete for new workers and attempt to prevent defections to sweeter prospects. Put simply young Chinese factory workers are less willing to toil for long hours for appallingly low wages. The supply of 16-24 year old workers has peaked and instead of ‘chi ku’ (eating bitterness) like the older generation, a younger generation of workers is changing their habits. A rise in education and less saving than their parents has lead to vastly different situations for employees in China. For more information see

Two faces of a crisisND

Catherine Fox, AFRBoss, 10 July 2010

Whether a crisis is environmental or financial it can be dealt with in the same manner; there are two distinct phases that require different strategies of engagement. The emergency phase, the initial crisis stage, requires organisations to buy their time and stabilise the situation. The adaptive stage, the latter stage of a crisis, the leaders of the organisation need to tackle the underlying cause of the crisis and build capacity for new conditions. One of the main challenges remains to understand the psychology of expectations placed on companies in times of crisis. Many times key stakeholders are operating in an unrealistic timeframe. Immediate reactions to crisis, without enough consideration or with too much reassurance, can create a false sense of relief. For more information see

The higher costs of bribery in China ND

Dexter Roberts, Bloomberg Businessweek, 8 July 2010

Companies violating anti-bribery laws in China may be subject to prosecution under both increasingly stringent Chinese and US laws, following the Foreign Corrupt Practises Act (FCPA) which allows US prosecutors to investigate bribery anywhere in the world. Although bribery or gift giving was traditionally accepted as a custom in China, the risks are becoming higher, forcing companies to strategise on how best to ensure compliance with Chinese and US anti-corruption laws. For more information see

Cloudy innovation should brighten your budgetND

Michael Schrage, Harvard Business Review, 2 July 2010

The rise of super technology such as Twitter, Facebook and Youtube has created a ‘cloud of web services’, offering value to business organisations as playgrounds for testing innovative ideas. The cloud provides an opportunity for market testing before investing in new products or services, while its accessibility means that companies do not experience any tangible loss from usage. Although the cloud is not seen as a replacement for existing processing platforms, it provides both a medium for innovative play and business productivity. For more information see

Corporate sustainability: Are we really cruising in fifth gear?ND

Rory Sullivan, The Guardian, 1 July 2010

Recent surveys have demonstrated that the large majority of CEOs view sustainability issues as being of importance, and have taken steps to integrate sustainable practices into their companies’ strategy and operations. However a new MIT survey has suggested that while many business leaders are recognising the importance of sustainable practices, their actions aren’t living up to their words. Although some businesses have taken the lead in engaging in sound, sustainable business practices, many are lagging behind. For more information see

Lonely workers and suicide: what can responsible companies do? ND

Wei Zheng and Mabel Seah,CSR Asia, 30 June 2010

The recent suicides within Chinese companies have been linked to a rise in loneliness within working environments. Chinese people traditionally are not equipped to deal with these employment conditions and rapid changes in China. Corporations and social enterprises are pivotal for creating and sustaining campaigns that enhance social conditions. Preventive measures extend beyond national programs and companies can become involved at an individual level with workers. Seeing employees as living people with a wide range of different issues is a stepping stone towards building positive social conditions. For more information see

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